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- India's CBI Appoints Liminal To Manage Seized Digital Assets 🕵️🇮🇳🖥️
India's CBI Appoints Liminal To Manage Seized Digital Assets 🕵️🇮🇳🖥️
PLUS: India trained 3,000 police officials on crypto investigations in 2022–2023. BlackRock’s spot Ethereum ETF plan is confirmed after Nasdaq filing.
Manan Vora
November 10, 2023
Snapshot Web3
November 10, 2023
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Regulatory and Legal News
India's Central Bureau of Investigation (CBI) has appointed digital asset custodian Liminal to manage seized digital assets. Liminal has previously supported a CBI operation by assembling a specialized team to create multi-signature and multi-party computation wallets for the safe storage of seized assets. The details of the operation were not disclosed. India has experienced several major cryptocurrency scams, with the CBI actively investigating such cases. Liminal raised $4.7 million in its seed funding round in mid-2022 and is focused on building a safe and regulated digital asset ecosystem in India.
The European Parliament has voted to approve the Data Act, a piece of legislation that includes a stipulation requiring smart contracts to have the ability to be terminated. The legislation passed with 481 votes in favor and 31 against. The Data Act aims to allow users to access data generated from smart devices, addressing concerns about the underutilization of collected data. Critics, however, have expressed concerns about the broad definition of smart contracts and the lack of clarity on when interruptions or terminations should occur. The legislation now requires approval from the European Council to become law.
In the financial year 2022–2023, the Indian Ministry of Home Affairs reported that over 3,000 police officials from various cybercrime and police departments were trained in cryptocurrency forensics and investigation. The training was conducted by agencies like the Narcotics Control Bureau and the Indian Cyber Crime Coordination Centre, covering topics such as darknet investigations, cryptocurrency forensics, digital footprints, and intelligence gathering from open source and social media. As India focuses on addressing potential crypto-related crimes, the country continues to explore mainstream use cases for blockchain technology, with initiatives like the state-run oil and gas company Hindustan Petroleum implementing a blockchain system for automated verification of purchase orders.
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Innovation and Launches
BlackRock has officially confirmed its plans for a spot Ethereum exchange-traded fund (ETF) named the "iShares Ethereum Trust." The asset management giant submitted a 19b-4 form filing to the U.S. Securities and Exchange Commission (SEC) through Nasdaq. This move indicates BlackRock's intention to expand beyond Bitcoin in the ETF space. Earlier, BlackRock registered the corporate entity "iShares Ethereum Trust" in Delaware, hinting at an impending spot Ethereum ETF filing. Ethereum's price surged 8.9% to $2080 on the news, contributing to ETH's recovery in market dominance against Bitcoin, reaching 17%.
The Financial Supervisory Commission (FSC) of Taiwan has granted the country's first security token offering (STO) license to Cathay Securities. Cathay received regulatory approval for its "Sunshine Green Yield" STO bonds, with a maturity of six years, initial annual interest of 3.5%, and an initial principal amount of $930,000. The STO will allow enterprise owners to purchase green electricity for environmental, social, and corporate governance initiatives. Cathay Securities developed Taiwan's first STO evaluation model, claiming it is 95% accurate in calculating the default probability of small and medium-sized businesses. Trading for the Sunshine Green Yield bonds is set to begin on December 12 on Cathay's in-house STO exchange platform.
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Funding
Venture capital firm Lightspeed Faction has launched a $285 million fund for crypto startups, focusing on early-stage blockchain projects. The fund aims to provide capital for projects as they scale and offers founders access to an experienced team of blockchain investors and operators. Lightspeed Faction, a joint venture between Lightspeed Venture Partners and crypto-only fund Faction, emphasizes its commitment to investing in promising blockchain projects to advance the technology. The fund has supported several successful blockchain startups in the past, including Crossmint, Lens, Narya.ai, Skip.money, Matter Labs, and more.
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Scams and Hacks
Irina Dilkinska, the former head of legal and compliance at OneCoin, a cryptocurrency scheme that defrauded investors of $4 billion, has pleaded guilty to wire fraud and money laundering charges in a Manhattan federal court. Dilkinska faces a potential maximum sentence of 10 years in prison for her role in the OneCoin scheme. Despite her position as the head of compliance, she played a significant role in laundering money for the fraudulent scheme, facilitating the transfer of $110 million in fraudulently obtained proceeds at one point. The sentencing is scheduled for February 14, 2024. OneCoin's "Cryptoqueen" Ruja Ignatova remains at large.
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Interesting Reads
Ethereum co-founder Vitalik Buterin and a team of experts have proposed a protocol called "Privacy Pools" to integrate privacy features into blockchain transactions while ensuring regulatory compliance. Privacy Pools aim to enhance transaction confidentiality by isolating funds into sets or categories, using techniques like zero-knowledge proofs to demonstrate legitimacy without revealing details. Association sets, subsets of wallet addresses, help maintain anonymity, allowing users to withdraw funds and prove their transactions' legitimacy. Trusted third parties, called Association Set Providers, analyze and evaluate pool contributors, separating trustworthy users from questionable ones. Critics express concerns about delays in adding deposits to association sets and the need to balance privacy and compliance. The proposal comes amid increased regulatory scrutiny and recent sanctions on privacy-focused services.
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Miscellaneous
Laos is reportedly seeking unpaid taxes and licensing fees totaling $20 million from cryptocurrency operators. The government had authorized 15 blockchain companies to mine or operate exchanges, but some reportedly made little progress, while others fell behind on payments. Prime Minister Sonexay Siphandone announced a 50% reduction in the tax balance owed by crypto companies due to a prorated drop in cryptocurrency prices since the obligations were set. He stated that companies failing to catch up on payments may face operational suspensions, fines, or license revocation. The move comes as Laos aims to boost state revenues amid challenges like an extended drought affecting electricity supply to crypto mining operations.
Deutsche Börse, the owner of the Frankfurt Stock Exchange, has included crypto in its strategic priorities outlined in the "Horizon 2026" report. The company plans to expand its leading position in digital platforms by accelerating the development of its blockchain-backed D7 digital securities registry and creating a trading platform for digital assets. The digital asset platform will cater to institutional investors, providing services for tokenization, trading, settlement, and custody of securities, alternative assets, and cryptocurrencies. While stablecoins and central bank digital currencies are mentioned, their specific status on the platform is not detailed.
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The information provided in this newsletter is for informational purposes only and should not be interpreted as investment advice, endorsement, or recommendation. Cryptocurrency investments carry significant risk due to their volatility. You should consider your financial situation, investment goals, and risk tolerance before making any investments. We strongly recommend consulting a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results.
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